IRS Extends Time-Sensitive Deadlines to July 15, 2020 Due to COVID-19

On April 9, 2020, the IRS issued Notice 2020-23, extending deadlines for a large number of "time-sensitive acts" due to be performed on or after April 1, 2020 and before July 15, 2020. The relief applies to any person (including any individual, trust, estate, partnership, association, company, and corporation) with a specified time-sensitive action due to be performed during that time period and encompasses numerous deadlines relevant to employee benefit plans, including deadlines for:
 

1. Loan repayments to qualified employer plans;
2. Distribution of excess deferrals and related income and excess aggregate contributions and related income;
3. 60-day rollovers of eligible rollover distributions to eligible retirement plans, including IRAs;
4. Filing Form 5500, Form 5500-SF, Form 5500-EZ, and Form 8955-SSA; and
5. Correction periods for self-correction of operational failures under the Employee Plans Compliance Resolution System ("EPCRS").

The relief automatically postpones until July 15 the deadline for any of these time-sensitive actions that were due to be performed on or after April 1, 2020 and before July 15, 2020.

Prior Relief

Prior to Notice 2020-23, the IRS had already issued three notices extending filing deadlines and providing relief related to the COVID-19 pandemic.
 

• Notice 2020-17, issued March 18, 2020, extended the deadline for 2019 federal income tax payments that were due on April 15, 2020.
• Notice 2020-18 expanded the relief provided under Notice 2020-17 to all "persons" under Code Section 7701(a)(1), including an individual, trust, estate, partnership, association, company, and corporation.
• Notice 2020-20 provided similar relief to any person with a federal gift tax or generation-skipping transfer tax payment (or related filing obligation) due on April 15, 2020.

New Relief

Notice 2020-23 greatly expands the relief available for employee benefit plans and participants due to the COVID-19 pandemic. Importantly, this relief applies to any person (including any individual, trust, estate, partnership, association, company, and corporation) with any specified filing or payment obligation due on or after April 1, 2020 and before July 15, 2020 or any specified time-sensitive action due to be performed on or after April 1, 2020 and before July 15, 2020.

The specified filing and payment obligations include:
 

• Individual income tax payments and return filings on Form 1040
• Corporate income tax payments and return filings on Form 1120
• Partnership return filings on Form 1065
• Estate and trust income tax payments and return filings on Form 1041
• Exempt organization business income tax and other payment and return filings on Form 990-T
• Quarterly estimated income tax payments and Form 990-W, Form 1041-ES, and Form 1120-W

More importantly for employee benefit plans, Notice 2020-23 also extends relief to any person performing a specified "time-sensitive action."

Time-Sensitive Actions
 
Notice 2020-23 extends relief to two classes of "time-sensitive action" described in other IRS guidance. First, the relief includes:
 

• Filing a petition with the Tax Court or for a review of a decision rendered by the Tax Court;
• Filing a claim for credit or refund of any tax;
• Bringing suit upon a claim for credit or refund of any tax.

Second, Notice 2020-23 incorporates the time-sensitive actions listed in Revenue Procedure 2018-58, a mammoth 139-page document that simply lists in tables the acts the IRS may postpone by reference in the event of a federally declared disaster.
   
The time-sensitive actions postponed until July 15 under Notice 2020-23 include deadlines for:
 

1. Loan repayments to qualified employer plans;
2. Contributions to IRAs to be considered contributed in the prior taxable year;
3. Furnishing IRA contribution information to the owner and filing Form 5498 with the IRS;
4. Furnishing HSA contribution information to the beneficiary and filing Form 5498-SA with the IRS;
5. Year-end forfeiture of unused amounts elected under a cafeteria plan;
6. Elections by a qualified participant in an ESOP to direct the plan's investment of at least 25% of his/her account;
7. Distribution of excess deferrals and related income and excess aggregate contributions and related income;
8. 60-day rollovers of eligible rollover distributions to eligible retirement plans, including IRAs;
9. Rollovers of qualified plan loan offsets to eligible retirement plans;
10. ESOP's distribution of dividends on stock of a C corporation to participants and beneficiaries;
11. Elections of permissible withdrawals from an eligible automatic contribution arrangement;
12. Distribution of nondeductible contributions to a qualified employer plan to avoid 10 percent tax;
13. Distribution of excess contributions to an IRA or certain other tax-favored accounts to avoid a six percent tax;
14. Filing Form 5500, Form 5500-SF, Form 5500-EZ, and Form 8955-SSA; and
15. Correction periods for self-correction of operational failures under the Employee Plans Compliance Resolution System.

Notice 2020-23 automatically postpones until July 15 the deadline for any of these time-sensitive actions that were due to be performed on or after April 1, 2020 and before July 15, 2020.
 
Additional Information
 
The relief provided by Notice 2020-23 is automatic and includes all schedules, returns, and other forms required to be attached to the specified forms. If affected persons need additional time to file, they may request an extension by July 15, 2020. Extensions will not exceed the original extension date (e.g., October 15, 2020 for Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return).
 
Notice 2020-23 also extends by 30 days the deadlines for the IRS to perform specified time-sensitive actions, including:
 

• Assessing any tax
• Giving notice or demand for payment of tax
• Collecting any tax owed
• Bringing suit for tax liability
• Allowing a credit or refund of any tax

The 30-day extension applies with respect to persons currently under examination, whose cases are with the Independent Office of Appeals or who file amended returns between April 6, 2020 and July 15, 2020, among others.
 
For more information about IRS relief related to the COVID-19 pandemic and how it might affect your employee benefit plans, please contact Gary Blachman, Audra Ferguson-Allen, Chris Sears, Kathleen Sheil Scheidt, Sarah Funke, Melissa Proffitt, Tara Sciscoe, Rob Gauss, Austin Anderson, or the Ice Miller LLP Employee Benefits attorney with whom you work.
 
This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader's specific circumstances.